Indonesia recorded its first annual deflation in more than two decades
According to the data released by the Central Statistics Bureau of Indonesia on the 3rd, the monthly (month-on-month) deflation rate of Indonesia in February 2025 was 0.48%, and the annual (year-on-year) deflation rate was 0.09%, which was the first annual deflation in the country in more than 20 years.
The last time annual deflation occurred was in March 2000, when the rate was 1.10%, mainly due to falling food prices, said Amalia, the bureau's director.
Amalia clarified at the press conference that the deflation is not due to weak purchasing power, but the electricity subsidy caused. In addition to electricity prices, other goods are still experiencing inflation, with prices of gold jewelry and cars rising.
According to reports, in order to promote economic growth, the Indonesian government in the first two months of 2025, the power of 2200 volt ampere or less of the customer's electricity charges halved. Electricity prices have returned to normal.
In addition to electricity prices, other deflationary factors include falling food prices, such as chicken, eggs and chili peppers, Amalia said.